 Welcome everybody to Digital Asset News. My name is Rob and I'm joined by friend of the show Simon Dixon for coming by just to explain some things about what's going on with Celsius. Simon, welcome back to the show for I think it was like the fifth or sixth time. Yeah, it's getting pretty critical now. So thanks for having me back. Yeah, this is important. So if you don't know who Simon is, it's okay. I didn't know him either before I met him. And I got to tell you, he's doing some pretty good things far as investing in small little companies like Crack and Bitfinex, Bitstamp, Ethereum, on the industry or the investment services of Bank of the Future. I will link that in the description below. And unfortunately, Simon had come out and he's been fighting for us with Celsius. And that's why I say if you have any information or any questions about what's going on with Celsius, follow Simon Dixon. And one of the tweets that he put out recently kind of gave me pause and he said, look, this was taken from me. This was a whopping $8.8 million in Bitcoin. So Simon, I can ask you this question, what the heck happened here? And is that like an enormous, is that like like an enormous amount of about of funds? I mean, it is for me. I don't know about you. Yeah, I mean, you know, people are laughing at me quite a lot right now because I didn't notice 300 Bitcoin was missing from my account in Celsius. And somebody was going through the records. And they tried to say that Simon Dixon withdrew $8.8 million from the platform. I'm like, I've never withdrawn anything from Celsius and everything's public records. So what the hell are they talking about? And it was somebody that was actually trying to attack me saying that I've been disingenuous. So I was like, what the hell is that? So I looked into my account. And there was this hidden transaction that I didn't notice before, whereby a while back I applied for a loan because the only reason I was in Celsius is because I didn't want to sell some Bitcoin. So I was experimenting with how do you build up enough? How do you put enough Bitcoin in the account where the interest on a loan would be covered by the yield? And so I ended up with, you know, almost a $20 million account. And at one stage it was worth $45 million. Now, I know these big numbers are big and missing 300 Bitcoin. Most people would notice that. It's embarrassing. It's my own account. But I got so caught up in the weeds of fixing the big puzzle for everybody that I never actually audited my own account. And when I looked into that, it turns out that I'm the only customer on the whole platform whereby 289 Bitcoin was taken out and locked on my account. That's the transaction I showed you. On the day of the pause, they never issued the loan. I just assumed that the collateral was returned because there was no loan. But they kept the collateral and didn't issue the loan. So $8.8 million was literally rugged on the 12th of June. And I only just noticed it. The deadline has now passed. And so I think this makes up that's just point blank criminal theft. Because so, you know, if this can't be arranged, then I think we have our criminal case against Alex Mijinsky. So I announced that we probably have what we need to progress this from a civil case to a criminal case. Right. And so some people will say, well, how could Simon not see that? Look, there's different variances for every type of investor. Something is an enormous amount of money for some people. And some it's not that much. Some it's in the middle of the road. But then also before we move on to the next part, which is I know that it was a troubling time for you around that date. And I believe your father had passed away. Then this thing happened, people had to essentially pull you out to help us and give us some a little bit of information. So for me, it makes a lot of sense. And I got to tell you, I'm sorry it happened to you. I'm sorry for everybody out there that actually went in with Celsius. So yeah, I just want to say on it is all relative. And for me, this was a percentage of my net worth that I was willing to put into the risk side. I really don't want to be insensitive during times of such really big financial anxiety, because a lot of people had their entire net worth and their entire life savings and their retirement funds. But for me, that's an amount that is not noticeable. I've been in Bitcoin since 2011. I've been dollar cost averaging since. Yeah, I got you. So that'll be my next question, which is this, I know that I mean, I keep getting questions about Celsius and I'll be honest with you, man, I am pretty much done with it. My stance is this, liquidate it. I don't really care, just liquidate, give me whatever it is, because the people that are dealing with it right now, I think it's just an awful show. And I don't have the patience for it. You, my friend, have a ton of patience. I don't know how you have this much patience. I've seen you in the Twitter spaces as people are yelling at you and calling us our names, Saint. But there was a video that you put out recently and it was pretty good. It was, well too, Celsius Curious Fight Back and the Chapter 11 Wars. And you just, you really broke it down. And there was, there was eight different sections. I'm going to link this in the description for you that are watching this video. You can watch this later. It is 52 minutes. It is gold. It will catch you up to date of what is going on. And he thought, he starts out with this, there's a custody war, custody people are really going to break some, you know, bring some things back if this goes through. But the earned people, which is like the majority of people, you're going to get pretty much screwed and there's going to be a big haircut, depending on what the UCC talks about. There's all this thing about clawbacks and people are talking about, well, I'm going to lose this because they're going to claw this things back. But it's all about, it's a settlement weapon or a negotiation weapon for, for the UCC. And then the new player on the block, Nova Wolf, which was just created in 2021, they, they came in and said, we're going to take over, we're going to make this thing work. But we have no ability to do anything as far as like with these clawbacks. And they even say here in the FAQ that we can't do anything. It's all about the UCC. Of course, you and your video were talking about like, no, they are a part of this. And that is part of the negotiation. So don't unfool you. And then you go over Celsius wars and the token, which I think is worthless and even nice enough to go, well, I'll do 81 cents. They know what was a bit lower than that loan wars and a whole host of things. So that, I mean, in a nutshell, you laid it out very, very eloquently and nice, but you're a better person than me. So if you want to watch this, this is the part, but the question I had then is long question. So that was the plan. What can voyage your takeaway from this? Because they're going through the same type of thing, what should they take about? And is there anything you want to like really put in as far as like a note of what I just talked about, please do so, my man. Yeah, so I strongly recommend that the people watch that video, not just if you're a Celsius creditor, but if you're a creditor in BlockFi, if you're a creditor in FTX, if you care about the future of using centralized exchanges in the future, this is a financial education. And I tried to condense everything down into that video. So I highly recommend if you're a geek like me, and I'm just a finance geek, and that's why I've got the patience, because this is what I live, breathe, eat, and share. So you give me a financial problem, I don't sleep until it's solved. And that's why Celsius for me, I had the skin in the game, I have the financial interest, and I've had the stories of, and I've built incredible friendships and people that hate me, yes, that's okay. But we've actually reached a point of unification when they realized that this plan gave them 20 cents for their sale token. They thought I was the enemy because I told them the SECs never go into allow you to get sale token to come back. It turned out they would have got 4x better under my plan, even though they fought me for about eight months. But we're now, everything's water under the bridge because we have got the top lawyers that are spending our money at a rate of approximately $20 million per month in some months, in order to put together the best damn strategy. And so we need to equalize that because the power that we have is that we have been through this journey. We've been doing Twitter spaces every week until this shit is done and we'll carry on until this stuff is done. But unfortunately, each Chapter 11 has become collateral damage and an education for everybody else. I feel so bad for Voyager. Voyager were in a better situation than it seemed like it was at Celsius. But obviously, Scam bankrupt fraud came along and tried to renegotiate his way out of his shit when he was his financial positions, offered them 72% on the dollar to try and hide all of their fraud, and then went bankrupt in the process when CZ exposed the balance sheet. And so they went down and then Binance said, well, we feel like shit, probably, we should probably come in and try and settle. Now, it's only about 50% now because we didn't have any of those fraudulent loans that we can uncover. And obviously Binance is Binance, they're going through the regulatory politics, they're not the US's favorite company. And they obviously can't, everything that I said with the Celsius case is now happening. Now FTX has come along and wanted to claw back, you know, $480 million. That means that they're down to about 20% on the dollar. And also, there's a bunch of money held back and the SEC is objecting to the plan, the FTC is objecting to the plan, the New York Federal Department of Financial Services is objecting to the plan because it doesn't treat everyone equally, they can't trade the VGX token. And so fortunately, if Celsius had listened to what I did in this plan, you know, this is why I ended up in just being so unpopular with the cell token holders. But now fortunately, hopefully we can get that and we're more unified. Now, there are really, really important things that need to come out of this Celsius case that are going to shape the rest of the industry. And I boiled it down to obviously that video goes deeper into some of the games that all that happen. But there's really three things that I think are very simple things for people to understand that we as an industry need to appreciate and the impact it has on our sector so I can dive into those if you want. Yeah, let's do it. Three things. People need action. First thing, if a bank goes bust, Celsius wasn't a legal bank because it didn't have the licenses and that's why it's in this really weird situation where it did what a bank can do, it owns your money, it spent your money, it rehypothecated your money and because it had no regulatory oversight, it did everything fraudulent. It took 600 million of our Bitcoin and pumped the sell token while Alex Mijinsky, the criminal, took the thought that he was going to withdraw his funds at the same time as trying to persuade me to put more of my client's retirement funds in and all sorts of shady activities. They have to have insider clawbacks but innocent people that managed to get their lifetime savings out of Celsius because they listened to the people that were given them warnings that received lots and lots of shit because they were told that they were fudsters they actually saved billions of dollars for people. Now they may be asked to put back their money but the whole point of clawbacks is to get the insiders, not the innocent people that managed to get their money out of this fraudulent operation and so we need to fight that. This is going to be personal bankruptcy for those people that listen to Alex Mijinsky's BS each and every week when he was telling all of us all of these complete lies when his company was insolvent since 2021 and he used a bloody token in order to hide all his fraud and if they are being asked to bring back their money through clawbacks that is not the essence of what this is to achieve and the law firm that is actually representing the UCC, White and Case has decided that they want to set up a liquidation trust which guess what they'll probably apply to manage and if we learn from Voyager, Voyager UCC asked for $68 million from creditors in order to pay for legal fees to fund their litigation trust and so this is just another way of extending this and there's a little bit more that we need to understand so that's the first thing. This is just a mechanism for the lawyers getting paid more and more and more and destroying people's life. It's deeply immoral, it's deeply unethical and it should only be used for those and by the way I have no insider exposure, I was dumb enough to leave my money in Celsius and I didn't withdraw it and so I'm not one of those people that's affected by this but I can tell what is wrong from all the friendships that I've built over these last eight months. Yeah, Simon real quick, we're both dumb, you lost, like you got a nice little seven figures, I got six figures on there, it's just how it is. We just trust a little bit too much and we just got caught up in the winds. Yeah, unfortunately because of that $8.8 million that Alex Mijinsky rocked on the 12th of June, I thought I was the 21st largest creditor and I had this badge of honor because 21 is my number, 21 million Bitcoin. Now I'm the 10th largest creditor I think because there was a bunch of money that I didn't realize was there. Anyway, that's number one. Number two is essentially the way that this has turned out is I published a seven part video series on my YouTube with the exact framework that I thought was best in order to maximize the result for creditors. I gave a couple of days as you asked after my father passed away a complete real plan to Alex Mijinsky and his investment bank and they obviously didn't implement it because all the fraud they needed to hide and they didn't want to expose that later came out with the examiner report. Alex Mijinsky was trying to hold on to control until he literally got booted out and bribed in order to try and get out essentially because he wanted to hide all of his shady shit. But I gave them that framework. That framework, white in case has said, has been used to train people on how to put together a plan. Now I was forced into a bidding process where essentially I said, right, if no one else is going to set this framework up, then Bank to the Future will do it. And what it was is what's called a stalking horse bid. And a stalking horse means that what you do is you set the framework that optimizes the result for creditors. You work on term sheet that is covered. There's a cost to the estate if you don't win the bid. But other bidders can come along and outcompete you and say, well, we can do this much better. We can take on the loan book, we can take on the mining operation and it would completely laid out the framework for others to come and do it better. At Bank to the Future, we barely wanted to do this. It was just how do we get that? Now, so that's the stalking horse process. That's the second thing we need because unbelievably, somehow, White in Case, who represents Figure, Novowolf, and Terror Wolf were given a monopoly on sponsorship of the Celsius plan with no stalking horse. So White in Case that represents the UCC, Terror Wolf, Figure, and Novowolf had to put out an additional disclosure statement because of all the conflicts that exist based upon their clients. And they were given a monopoly in this process instead of a stalking horse. I need to understand that. And there's a space tonight with Novowolf. They're doing the first space to try and speak to their community. But what I want is, okay, if Novowolf, you be the stalking horse, I'll take Bank to the Future out of the equation. I'll just be a schmuck creditor like everyone else. It caused lots of problems with me having conflicts. So Bank to the Future is out of the equation. But why not have Novowolf as the stalking horse? Because I've got 10, 20 other people that want to try and do better with the security token, the lending book, the mining. And let's create this a competitive process rather than an old boys' network. You scratch my back, I scratch yours so that we can get the best results. So that's the second thing we need. We need callbacks defined. We need the stalking horse set up. And then finally, number three, they have created a convenience class. This convenience class is essentially a way of bribing people that have less than $5,000 on their account. What they do is they say, all the other creditors, you pay in order to bribe and we'll give them 70% whereas you're going to get about 20, 30% and some equity. But what this is designed to do is there's a loophole and it's actually part of the bankruptcy code. It's not really a loophole. But it's in order to what you have to do is you have to get majority vote from one class of creditor. So all of us are in one class and then those that are below $5,000 are in another class. If we say no to the plan, but the people that have $5,000, they can accept the bribe and it's called a cram down. They can cram down the plan down our freaking throat. And those that, you know, that accounts for about 85% of people. This is all the people that withdrew their money. And they're even saying, we can negotiate with you by removing some of your clawback exposure. And they're using this in order to cram down a plan. Now, from my perspective, use the framework I gave you, put it in a stalking horse, take out those clawbacks and compete on the best plan, not cramming down and using the bankruptcy code and every trick under the sun with clawbacks in order to negotiate a plan that maybe sorts out your old boy network, but doesn't give the best result for creditors. These are fiduciary duties. And so I'm going to, you know, these are the three things, no cram downs, no clawbacks and stalking horse setup. Now, why is that important? Because that is how we set up the framework in the future. When banks used to go bust in the 1930s, they set up a framework whereby another bank would come along and all the rules were set and everyone could get their funds back fast. We need the same framework for centralized lending platforms, centralized crypto exchanges, just like traditional financial institutions have so that then we can have trust that we'll all use DeFi, we'll have our hardware wallets, but we still need on ramps and off ramps. And those companies need to have a correct framework so that people can get their money when they're fraudulent or doing things with financial or end up in financial distress. Great. So Simon, excellent response. So besides people watching the video, I'm going to link on the different ones and also maybe join you on Twitter spaces tonight. So I want to put this video out today is what can individuals that are just the average retail investor, what can they do? What is their course of action? How do they vote? How do they get involved? Yeah. Firstly, you have to ask yourself the ethics of if you accept that bribe for the convenience class, you are essentially subjecting everyone else to these callbacks, which is financially destroying for many and cramming down a plan on others. Now, I understand the moral dilemma here because for you, this is a lot of money, but we need to understand the game here so that we can make the conscious decisions. And firstly, we can try and stop it from happening. So how do we do that? Well, we have been doing a Twitter space on my Twitter every week for about the last eight months with creditors to try and equalize the game. We're spending approximately 10 to 20 million on these lawyers that are developing strategies that may not be in our interest and we're paying the fricking bill and it's reducing the amount that we may get at the end. And so to counter that, they got to try and win our votes. To do that through a cram down, that's a failure that should not happen, as I said. And so we managed to use Twitter spaces to be loud enough whereby the UCC took up leadership, forced their advisors to do what they say, and they submitted an objection to Celsius getting exclusivity, which is something they wanted to do, extend exclusivity, extend exclusivity. That worked. Judge Glenn said, right, I'm not a fan of opening up. I would like Celsius to submit a plan. They submitted a plan about one hour after midnight on the deadline on Valentine's Day during the court hearing. So he said, we've got to give time for people to object to this. That happens on the 1st of March. And so they released a first draft plan. That plan was essentially my plan, but it took out about seven of the important features that make this right for creditors. Those need to go back in. And that was covered in that video, if people want to get into the geek of this, you know, technicals. Perfect. Right. So if they don't do that, there's a court hearing on the 8th of March, where Celsius are going to ask for an extension. And they're going to ask for an extension until the 31st of March. Okay. That's okay. We need that extension because between the 8th and the 31st, we've got to get everything back in the plan. And if they don't put that back in the plan, if we don't get no cram downs, if we don't get no clawbacks or just inside of clawbacks or well defined, they've got that time to put together a good term sheet and a stalking horse set up. And then the stalking horse can be that opens up to the competitive market. And then by August, September, everyone gets their funds back. And we got all that time to negotiate the best deal. That's what should happen from here. No monopoly, no sponsor, no, you know, cram down in a plan because you're given it in the old boys network. And I'm more than happy for Nova Wolf to put together the best plan. This is not me, you know, saying being bitter because they chose Nova Wolf over bank to the future. I think they made the right decision in that, you know, that's a very US centric company. It's more likely to get through the court. It's got the SEC approval that's needed. But there's a bunch of stuff, and there's a bunch of other companies that need the opportunity to put together a better offer as well. Yeah, that's true. That's one good point. I mean, they are SEC registered investment advisors. So I guess that is something. All right. So Simon, it sounds like what it comes down to is we're going to get an extension. We just got to stick around. We just got to be informed and then go from there. And then if you want to vote, you can vote. I think that's that is a bigger thing. I think for me, like when I take a little voice, I'll give you a voice role because we're doing every Friday. I do my Twitter space. And everybody who's anybody that's got influence in this process is lurking in the background in their all accounts listening to that. So you've got the UCC listening, you've got the legal professionals, you've got Celsius, you got Nova Wolf, you've got the other alternative bidders. They're all in those spaces listening on their next move. So if you want your voice heard, stand up to the stage, request to be a speaker. Sometimes we go on for bloody three, four, five hours. It's crazy. But you can have your voice heard. They are listening. And this is all going to be defined leading up to the 31st of March. Perfect. Okay. I got that. I'll be on the next one then for sure. And I will just say this, like I know that this one came out this pure custody and dirty custody. I personally am dirty custody. I was the moron who was like, well, I was in urn. And then when it all came down, he said, you have to be an accredited investor if you want to earn on this one. I am, but I didn't feel it was fair for my viewers. So I put it into custody. I just didn't take it off. And the day that I did the video to take things off, that's the day that shut things down because I was doing test transactions. So what I'll do is I'll just say this, I'm not going to approve this part for me to get this back. If everybody comes along with me and says, hey, we want to get the best thing for all creditors because I mean, we're either going to, we're either going to hang together or we're going to hang by ourselves. Benjamin Franklin. Fantastic answers. Simon, I know you're busy, but thanks for stopping by. Again, everybody, if you're looking for answers, because on this show, I've only got a limited amount. Follow Simon Dixon. There's a link in the description. Watch all these videos. Take a look. And also, we're going to go to the Nova Wolf Twitter Spaces tonight, I think it is, and we'll all be there listening in. So I'll drop this today. And that is it. Simon, thanks so much for stopping by. We appreciate it. Okay. Awesome, Rob. Thanks for sharing this journey with us and other people, the information they need.